Kyrgyz airports to register 30 million dollar profit in 2016

Currently MAM continues to invests in reconstruction of its subsidiary airports (Photo by Bektour Iskender // Wikipedia)

By the end of 2016 the operational revenues of International Airport Manas (MAM), a company that manages airports across Kyrgyzstan, will reach 2 billion soms (about $30 million), 24.kg news agency reports with the reference to MAM CEO Emir Chukuev. The top manager explains the anticipated profit is a result of the business process optimization and cost reduction strategy that the company has been implementing since 2013.

As of today, MAM incorporates five international (Manas, Osh, Issyk-Kul, Karakol, Batken) and six regional airports (Dzhalal-Abad, Isfana, Karavan, Kazarman, Naryn, Talas) as well as two dormant gateways of Cholpon-Ata and Kyzyl-Kia.

The company has also elaborated on the work that has been done this year in terms of airports reconstruction. Particularly, this year the country’s biggest airport of Manas has restored both apron and runway. In an effort to enhance its overall capacity, in 2016 the gateway started to build up the eastern concourse of the main terminal as well as continued reconstruction works in the western wing. Besides, the airport is about to finalize project design works for upgrading the heating, ventilation and air conditioning systems of the main passenger terminal.

The airport of Osh is also going through a modernization process in order to eliminate the existing operational restriction. It has completely resurfaced the main runway and reconstructed the taxiways. Apart from that, the gateway is extending its air terminal and reconstructing the VIP-lounge.

Reconstructed Issyk-Kul Airport is now able to receive aircraft round-o-clock in any weather conditions. All works have been completed within a record-breaking five-month time frame.

Chukuev says all MAM’s infrastructure development projects are both self-financed and involve external loans with the Russian-Kyrgyz Development Fund being one of the external sources of investment. The reconstruction works will continue next year.

Currently, only Manas and Osh airports operate regular flights. Airports of Batken, Isfana and Dzhalal-Abad work part-time, while gateways in Issyk-Kul and Karakol are open for seasonal time-tables. However, MAM retains financing for all airports with no exception to cover operational and labor costs. The country might need the airports in well-maintained and operable condition in case of an emergency or a similar situation, Chukuev explains. At the same time, the attempts to arrange regular flights to inactive or underutilized airports have not been successful so far, he adds. Even after reconstruction, some of the airports will not see any traffic as citizens in some regions prefer less expensive ground transportation to flying. More to that, airlines lack small aircraft which could operate flights to those destinations.

Hence, the investments, which MAM estimates will comprise 3 billion soms ($43 million), will have no financial payback. The company suggests that for the sake of regional development the national government should subsidize the projects or get private investors involved in airport management activity.

MAM sees that international operations in Manas and Osh grow in terms of both regular passenger and cargo traffic which in its turn positively affects the company’s profitability. The operator expects that upon reconstruction it will be able to bring in even more cargo and passenger carriers to these ports.

As previously reported, passenger traffic in MAM’s airports decreased by 0.6% in January-November 2016 and reached 2.8 million people. The decline was mainly provoked by the reduction of passenger traffic on domestic flights. By comparison, combined passenger traffic of Kyrgyz airports in 2015 constituted 3.04 million people which was 2.4% higher than in 2014.

Powered by Air Transport Observer, Russia & CIS’ premier information provider on commercial aviation with a 20-year legacy, Russian Aviation Insider provides you with timely and reliable business news, insights and analysis on commercial aviation all around CIS.